Vice President, Supply Chain
Avera Health
August 2023- The Journal of Healthcare Contracting
Sara Henderson is the Vice President of Supply Chain for the Avera Health System based out of Sioux Falls, South Dakota. She oversees the functions and departments used to manage supply chain services. Supply Chain at Avera consists of the management of flow of products and services to include: strategic sourcing, value analysis and contracting for all medical and non-medical supplies, non-clinical services, information technology hardware and applications; optimizing cost management strategies in non-labor spend; vendor management; procurement and data management; logistics, fleet and courier through its 72,000 square mile footprint; a central distribution center; print and overall supply management for the delivery of care.
Any recent stories of wins/successful supply chain projects you can share?
It’s interesting as supply chain is often behind the scenes helping. During the last few years, we’ve been presented many opportunities to work on meaningful projects to help support the improvement of our supply chain. The most recent projects that I would like to elevate are related to the growth in talent and interconnectivity of our supply chain organization due to the circumstances that have come our way. Through all the challenges that we face on a daily basis, our team has tackled them head-on with an eye to improve processes for the future proofing. These challenges have taught us that the power of an interconnected team is the greatest asset an organization can have. Each has unique skill sets, but all have to work together to make it a successful team.
Operationally, we have realigned our employees across the network in a way that allows them a common leadership structure to share their best practices and standardize many hospital and procedural supply operations. When you are an organization spread out geographically, maintaining common standards throughout all sites can be difficult. By aligning reporting relationships and creating standards, we are seeing employees share their talents to educate others throughout the system. They are finding efficiencies within their groups and then deploying those standard practices to all employees. Employees have developed a support network and have even shared staff for coverage from facility to facility when there may be a need for back-up in a tight situation.
Strategic Sourcing has been revamped to include a more mature governance structure, policies to align and visibility and oversight into all non-labor spend. The components of the structure include a competitive bid requirement, relationship-based agreement insights, a senior executive oversight group, and enhanced service line involvement. We have completed and are in the process of several large sourcing projects with physician-driven PPI decisions in spinal implants, orthopedic implants and osteobiologics. We have built a process that can be repeatable, yet individualized enough to ensure the clinicians bring their expertise to the decision-making process through value analysis. Our goal now is to refine this process and deliver the process at a faster speed.
Lastly, our purchasing department has been leading our efforts around backorder and substitute management, along with the rest of the supply chain departments, and with our primary med/surg distributor. They have created a mechanism to collectively work backorders and find substitutes, get clinicians engaged as soon as appropriate and refine the communication method to get notices out to the respective areas that will be impacted. If there is a system-wide critical issue, there is a mechanism to bring forward directly to our enterprise incident command for response and communication. Luckily, we have not had to use this final step in several months, but it’s set up to be deployed if necessary.
What about upcoming initiatives you are excited to be working on?
We have done a great job managing people and processes throughout our organization with the tools and resources that we have available. We are now starting on the deployment of a new enterprise resource planning (ERP) system to enhance the technology needed to help us get to the next step in our supply chain refinement. Through this deployment, we are refining many of our processes and are leveraging the technology to simplify and automate tasks that are currently done manually. We are aligning processes from several independent technology applications into one that will provide greater visibility to our end users and a simpler process for the start and management of projects within our supply chain.
In addition, we are increasing partnerships both internal and external to reduce unnecessary redundancies in our supply chain. We are building an Integrated Service Center with our pharmacy, biomed, home medical equipment (HME) and other supply chain service which will be located adjacent to our prime med/surg distributor. We are a rural health network that has far-reaching logistical challenges. If we can appropriately connect our data and technology and our logistical pathway for our goods, we can then continue to keep rural healthcare at a reasonable cost while maximizing the integrated network we have in our organization.
These projects combined will allow us to redesign and encourage a supply chain that is truly integrated, with reduced touches while still maintaining the proper levels of safety stock. Both projects will not be without a lot of dedicated time and work, but we are all excited to continue to enhance our supply chain network through the next 18 months.
How do you measure the success of your team and its impact on the organization as a whole?
We have the regular financial metrics for the hard data improvements like savings and cost per CMI adjusted patient discharge. These are used to gauge our overall supply chain financial impacts and keep us aligned to how we are doing overall. However, I also believe that soft metrics should be used to determine the success of the team within the organization.
Another, equally important measurement is the ability to be seen as a trusted partner to our clinicians and stakeholders throughout the organization. We measure this by being involved in the projects and programs up front, and by the trust level placed in employees to run a sourcing event for a system-wide decision. By being the first call when there is a problem, knowing that we will find a solution and deliver on the ask is a measurement to know we are a trusted integrated partner. After all, we are here to make sure we continue to fill that “magic cabinet” in healthcare that keeps refilling. We take pride in being seen as a partner to care.